a Car in Japan - Insurance, Registration, Taxes Etc.
We finally bought a
car after living in Japan for almost a year. We actually might
have continued with public transportation, except we had two twin
girls enter our lives. That brought us to three kids and two
parents, and riding the trains became much more difficult.
I'm not going to go
into details here. There are just a few simple points that
I've been wanting to share that we learned in the process of
shopping and buying a car. If you want to send additional
comments or questions, please use the email address below. I
will include any helpful information you want to send.
First of all, we
bought a used car. Common wisdom says that a new car loses a
huge percentage of its value when it rolls off the car lot. I
think that's even more true in Japan. The point is that a new
car may give you a certain amount of security, but it's a terrible
investment. A used car offers much more value for what you
Second, we realized
that it's often better to buy from a dealer. If you buy a used
car from an individual in Japan, then you will find out that there
is a lot of paperwork you'll need to complete and you won't get any
kind of warranty. Plus, in many cases, you can probably get a
better deal from a dealer. That's because most of the individuals
trying to sell their cars directly are foreigners. They don't want
to sell their car to a dealer (because dealer's pay so little), so
they're trying to get as much as they can for it by selling
directly. If you find the right dealer, though, they may
actually have some better deals. That's because they (the
dealers) can buy cars so cheaply from Japanese owners who
practically give their used cars away. An exception is when
you can buy a used car directly from a Japanese person, or anyone,
who is willing to sell it to you at or near what the dealers are
willing to pay.
Third, the price of
used cars varies greatly depending on where the dealership is
located. Prices in Japan can by very local. If the
dealership is in an area with lots of wealthy people, the prices
will be higher. If you go out to a rural area, you'll find the
same car would have a much lower price.
Fourth, we found that
the used car dealers located right next to the Yokota US Air Force
Base had much lower prices. We're not a military family, but
we learned this based on a tip from someone who lives there. I
assume that the used car prices are lower next to all the big US
military bases. That's because of two reasons: 1) the dealers
are able to buy used cars from servicemen who are forced to sell
everything in a hurry before shipping out, and 2) unlike the average
Japanese buyer, US military personnel are searching aggressively for
the best deal, so the used car dealers near military bases have to
compete by offering the best prices.
Fifth, we appreciated
the benefit of having the dealer handle all the paperwork and other
requirements. When you buy a car in Japan, you must pay
various fees. In addition to taxes, you must pay for insurance
and a mandatory inspection (called "Sha'ken"). You should get
additional insurance to adequately cover your liability in case of
an accident. Our dealer handled all of this, so after some
faxing back and forth and about a week of waiting, we showed up with
the money and picked up the car. Our dealer came with very
high recommendations, or we wouldn't have been so trusting. In
case you are interested, the name of the dealers is "Kelly's" and
they are located next to Yokota Airforce Bases (and they speak
English very well there).
Sixth, and last, "Sha'ken"
(mentioned just above) must be paid every two years on older cars.
The amount of Sha'ken goes up depending on the size, engine size and
age of the vehicle. During the Sha'ken process certain repairs
must be made, and it can get very expensive. On the other
hand, it helps insure that your vehicle is well maintained, so
you're much less likely to have it breakdown in between.
However, the fact is that as cars get older, Sha'ken becomes more
and more expensive. Eventually, if the car stops running well
or reaches a certain age (even though it's still a good car), you
may have to pay a fee just to get rid of it. This is the
reason why there are so few older cars in Japan. When cars hit
about 60,000 kilometers (maybe 40,000 miles), people start to
get rid of them. You'll find very few cars on the road with
more than 100,000 kilometers (66,000 miles). Many of these used cars
are shipped to other countries, like Australia and New Zealand,
where people love the endless supply of cheap, slightly used cars